Affin Hwang wrote in a note today it initiated coverage on Petronas Dagangan with a "Hold" rating and a target price of RM29.

"Petronas Dagangan, the marketing arm of national-owned Petronas is a well-established brand.

"It runs over a thousand petrol stations by a name known to many. We like Petronas Dagangan's business model due to its high barriers to entry, established branding and more importantly it operates a cash-cow business," Affin Hwang said.